Starting a Roadside Assistance Business
Are you the type of person who can manage a business 24 hours a day, and 7 days a week? Then the startup designed for you is the roadside assistance business which requires a person to be ready in rendering service to people from all walks of life.
This guide, will help you get started in the roadside assistance industry if you are planning to start off in the roadside assistance business.
In this service business, you will be a very busy person because you have to perform several services such as towing cars to the nearest auto mechanic shop, repairing flat tires, bringing customers' gasoline, jumpstarting dead batteries and unlocking the cars. To make you win in this kind of business, what you need to have are the most heavy-duty and high-quality materials such as jumper cables, repair tools for flat tires, locksmith tools, gas can, cell phone, and a tow truck.
Useful Advice for Starting a Roadside Assistance Business
Prior exposure: Your know-how will count a lot in this business. It is a requirement for you to have experience in being a roadside assistant.
Buying tools and accessories: If you are quite confident to do the job well, then your next step is to buy the tools that are needed for the trade as aforementioned. In this business, you can choose to do the job yourself or hire employees for performing all the required services. Depending on your funds, you can buy a flatbed tow truck to provide more services to customers having large vehicles.
Get ready to accept payment: You need to open a merchant account and buy a POS machine to swipe a credit or debit card.
Ways to price your service: The business structure is very important, with a right plan, you will be able to make a substantial amount of money. If the service is required at night, then you can add surcharges. This is the best part of this business when it comes to increasing profits. You will have to do your homework for finding the competitive price to charge for your service in the neighborhood.
Calculating profit: Every businessman is always looking forward to finding his ROI. Your total earning minus all your expenses including the interest that you pay towards the loan will give you the profit. If there is a certain employee who had been hired to render service on a night-shift, you need to consider the added expenses. Don't forget to add the bookkeeping expenses if you are outsourcing it. Finally, you will get a profit figure before tax.
Finalizing area of operation: Next, you need the coverage area to be defined. By doing this, you will be able to cut costs on gasoline expenses. To make sure that you adhere to the rules and regulations in your area in operating this kind of business, you need to carefully check your local police department. You also need to ask them on how to add your business to get listed on the call list. With this, they can contact you when they need to have a roadside assistance during accident scenes.
Beating the competition: Since this is an in-demand business, you also need to take into consideration your competitors. Check out how they advertise their business and what additional or special services they provide.
Advertisement: Next, you have to advertise your business so that you can get more leads and conversions.
- How much does it cost to start a roadside assistance business?
The major cost involved in starting this business is buying a towing truck. Depending on a new/pre-owned vehicle the rate is going to vary from $10,000-$200,000. Other formalities including insurance, tools, and paperwork are going to cost $7,000-$10,000.
- How to get a business license for roadside assistance?
If you finalized to provide towing services, then you must procure 3 licenses for it along with all other local licenses for a business. For local licenses, you must call your clerk’s office for more information. For towing services, you need the following licenses.
Indictment management, this is required by a tow truck to tow a vehicle when the request is initiated by the law enforcement officer.
Privet property, this is required by a tow truck to tow a vehicle when the request is initiated by parking facility owner.
Consent tows, this is required by a tow truck to tow a vehicle when the request is initiated by the vehicle owner.
- Do you need a commercial auto liability insurance?
Yes, you need a commercial insurance even if you are not planning to tow a car. One can mess up the vehicle while replacing a battery or tire, so major auto insurance companies will need your business to have a commercial insurance to work with them. You can check out some comments on reddit.com. Average insurance cost per year will be around $3,000.
- How much does a roadside assistance business owner make?
Earning varies with location, normally an owner makes in a range of $25,000 - $40,000 per year. A road side assistance technician's salary vary from $11/hr to $14/hr.
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